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Can US Derail China's Race to Become a Superpower in AI?

Updated: Apr 27, 2023

China has declared artificial intelligence to be a "national priority" and its goal to become "the world's premier artificial intelligence innovation centre" by 2030. The stakes are high because Chinese AI has potential to be a key factor in the growth of the nation and has applications in the medical, industrial, and transportation sectors, particularly in autonomous cars.

China offers benefits that go beyond just political declarations. The majority of smartphone users worldwide utilise virtual assistants, speech recognition software, and smartphones to pay for goods and services. In China, robots are largely acknowledged as a solution to the labour shortages that exist in banks, hotels, and hospitals. Robots are frequently used in delivery services and hotel front desks.

China generates a large amount of digital information, which is widely accessible due to regulations that, while they protect consumer data, are frequently relaxed in cases of "national interest", with 800 million smartphone users out of a population of 1.41 billion in 2021. For biotechnology, there are specific regulatory frameworks, bioengineering, and biopharmaceuticals to encourage collaboration between companies, researchers, and local authorities.

Several significant biotech innovations have been made, including automatic natural language processing and machine learning to gather and analyse medical data. The labour force in China is very skilled. At least a third of the 1.4 million engineers who qualify each year work in artificial intelligence, which is six times as many as in the US. China is the clear leader in artificial intelligence research papers, significantly surpassing the US in both quantity and quality.

The capacity of the Chinese sector to successfully combine digital prowess and retailing know-how through the integration of online, offline, and logistical data in a single value chain sets it apart from its worldwide rivals. This integration, when combined with AI, has made it possible to develop an incredibly effective delivery strategy.

The US AI chatbot ChatGPT, which can have intelligent dialogues with users, has undoubtedly stolen the show in the field of generative AI. However, the major Chinese companies are developing new applications and aiming to compete with their own platforms. Both Tencent's Different Dimension Me animated picture generator and Baidu can produce anime-style graphics from photographs of faces.

In spite of the favourable environment and various endeavours, Science and Technology Minister Wang Zhigang admitted in March that "China must wait" until it "sees results" similar to ChatGPT's. The majority of Chinese talent is also in the US, making it "a US secret weapon in AI."

In addition to this brain drain, firms in China's IT industry have made public gaps between investments pledged and actually delivered in order to campaign for funding. And a more stringent embargo is being pursued by Washington.

The White House forbade American businesses from exporting to China chip-making machinery, which is necessary for high-performance computing and supercomputers. Beijing's options are further constrained by the ban's de facto inclusion of non-US corporations.

A significant, expanding sector in China has been negatively impacted by stricter sanctions. Some overseas clients are already choosing to diversify their supply chains out of concern for further restrictions by US authorities.

These new initiatives will definitely be delayed by Washington's confrontational approach, but they won't likely be derailed. It might cause Beijing to isolate itself from the rest of the world and produce different technological norms, impeding the possibility of global cooperation on new technology.


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